The Best CD Rates in January 2020

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A certificate of deposit (CD) with the best CD rates is a great way to get the most out of extra cash on hand. CDs are offered by banks and credit unions and pay out a high interest rate on your deposit. The only catch is that you have to agree to leave the money untouched for a fixed period of time. Each bank offers different terms on its CDS, including the interest rate, the minimum deposit requirement and the penalties for early withdrawal, so it’s important to do your homework and compare to determine what bank offers the highest CD rates.

Top pick list of banks with the best CD rates

Bank 1-Year Rate 3-Year Rate 5-Year Rate Min Deposit
Ally 2.00% 1.95% 2.15% $0 (varies)
Barclay’s 2.00% 2.00% 2.10% $0
Capital One 2.00% 1.65% 1.60% $0
Charles Schwab 1.75% 1.90% 1.95% $1,000
Discover 2.00% 2.05% 2.10% $2,500
Marcus 2.15% 2.10% 2.25% $500
Synchrony 2.00% 2.10% 2.15% $2,000
TIAA Bank 1.95% 2.05% 2.10% $5,000

Ally Bank

Though Ally Bank’s APY rates are slightly lower than those of leading banks, they still offer great returns at the 1- and 5-year fixed-rate level, with moderately lower yields on 3-year deposits. The interest on Ally’s CDs compounds daily, and clients have the option to automatically renew their CDs at the end of their term without the hassle of any additional paperwork.

Ally also offers customers a 10 day best rate guarantee, which ensures you’re earning the highest CD rates the bank has to offer for the first 10 days after your deposit. That means if the initial rate of your CD goes from 2.35 to 2.4% within 10 days of your deposit, your rate will increase to 2.4% automatically. This feature also applies at renewal.

Ally Bank CD terms

CD Term Rate Minimum Deposit
6 months 1.00% $0
9 months 1.25% $0
12 months 2.00% $0
18 months 1.90% (varies) $0
36 months 1.95% $0

Barclays

You’ll be hard-pressed to find higher CD interest rates than the ones offered on Barclay’s 1- and 3-year terms. The CD interest compounds daily, and Barclays offers easy fund transfers with no hidden fees or mandatory minimum deposits on accounts. Though the APY on their 5-year CDs is slightly lower than what you may find elsewhere, it’s still much higher than what the majority of their competitors offer.

One downside to Barclays, though, is that it operates completely online. Customers who would prefer to have a face-to-face conversation with a representative before making a decision may want to look elsewhere.

Barclays CD terms

CD Term Rate Minimum Deposit
6 months 0.65% $0
9 months 0.70% $0
12 months 2.00% $0
18 months 2.00% $0
24 months 2.00% $0
36 months 2.00% $0

Capital One

Capital One’s rate for a 1-year CD is on par with what other financial institutions are offering, but the rates it offers for 3- and 5-year CDs are a bit below market standards. Still, one neat feature with Capital One CDs is the ability to choose when and how an account’s interest is paid out. Customers can pick from monthly, yearly or end-of-term payouts based on what works best for you, making Capital One’s interest payout structure one of the most flexible.

One drawback to Capital One, though, is its added fees. Customers who invest in a CD with Capital One can expect to pay $5 every time they receive a statement by mail. These statement fees, along with Capital One’s lower interest rates, may make some of the other banks a better bet.

Capital One CD terms

CD Term Rate Minimum Deposit
6 months 0.60% $0
9 months 0.80% $0
12 months 2.00% $0
18 months 1.90% $0
24 months 1.80% $0
36 months 1.65% $0

Charles Schwab

Charles Schwab offered some of the lowest interest rates on CDs across the board, but this bank still offers a few useful benefits for customers that use its services. Schwab customers can compare CD offerings by yield and maturity, and it is one of the only financial institutions that allows its clients to purchase CDs from other banks, since it also operate as a third-party brokerage service. As an added bonus, customers who opt to buy CDs from other banks will still see the CDs in their brokerage account so they don’t have to toggle between institutions to track their finances.

Though Charles Schwab may not offer the highest CD rates, this bank still deserves some consideration.

Charles Schwab CD terms

CD Term Rate Minimum Deposit
6 months 1.657% $0
9 months 1.704% $0
12 months 1.75% $0
18 months 1.75% N/A
24 months 1.80% $0
36 months 1.90% $0

Discover Bank

Discover requires a $2,500 minimum deposit in order to invest in its CDs, but its APY rates more than make up for the inconvenience. In addition to having the highest CD rates for 1-year, 3-year and 5-year terms, Discover also offers clients 24/7 customer service and a mobile app to check high yield CD balances from anywhere.

Discover also offers clients multiple funding options to make deposits from other bank accounts, by phone or by mail, and it doesn’t tack on any hidden fees when a new account is opened.

Discover Bank CD terms

CD Term Rate Minimum Deposit
6 months 0.65% $2,500
9 months 0.70% $2,500
12 months 2.00% $2,500
18 months 2.00% $2,500
24 months 2.05% $2,500
36 months 2.05% $2,500

Marcus by Goldman Sachs

Marcus by Goldman Sachs is unique in that it offers APY rates on CDs that are similar to what banks with substantial deposit requirements offer, but at a fraction of the cost. While some banks require as much as $5,000 for high yield rates, Marcus has a deposit requirement of just $500. Marcus is also one of the more convenient options because it allows you to transfer money from other banks to your Marus high yield CD account free of charge.

Marcus by Goldman Sachs does have a major drawback, though: only Goldman Sachs clients are able to invest in its CDs. That may be more hassle than it’s worth.

Marcus by Goldman Sachs CD terms

CD Term Rate Minimum Deposit
6 months 0.60% $500
9 months 0.70% $500
12 months 2.15% $500
18 months 2.05% $500
24 months 2.10% $500
36 months 2.10% $500

Synchrony Bank

Synchrony offers a number of products for customers who want to deposit sizable sums of money. The biggest draw is this bank’s high-yield CDs and the rates that they offer. Whether you’re interested in a 6-month or 5-year term on a CD, Synchrony offers some of the best CD rates on the market. This bank also offers 24/7 customer service and there are no additional fees tacked on each month, making its CDs a straightforward option.

The downside is the mandatory $2,000 minimum deposit this bank requires to open a CD account. Though some customers may plan on depositing more than $2,000, that high minimum could drive away customers with less investment money.

Synchrony Bank CD terms

CD Term Rate Minimum Deposit
6 months 1.00% $2,000
9 months 1.25% $2,000
12 months 2.00% $2,000
18 months 2.00% $2,000
24 months 2.10% $2,000
36 months 2.10% $2,000

TIAA Bank

When it comes to short-term CDs, you’re unlikely to find another bank with rates that are on par with TIAA. This does come at a cost, though, in the form of a mandatory minimum $5,000 deposit, but if you can part with that much money for a while, the benefits make it worth the hassle.

In addition to offering CD interest rates that are in the top 5% among competitive accounts, TIAA also makes their services available with no monthly account fees and automatic account rollover should you decide you want to extend the length of your deposit. With high APY rates and strong customer service, it’s little wonder that TIAA has been recognized as one of the 10 best CD accounts by GOBankingRates three years in a row.

TIAA Bank CD terms

CD Term Rate Minimum Deposit
6 months 1.65% $5,000
9 months 1.75% $5,000
12 months 1.95% $5,000
18 months 1.95% $5,000
24 months 2.00% $5,000
36 months 2.05% $5,000

What CD term should I get?

Ultimately, the CD term that you decide on will depend largely on your liquidity. If you find that you have a lot of financial wiggle room and can afford to go without some of your spare cash for an extended period of time, you should look into a longer term fixed CD. Generally, the longer you agree to leave your money with a bank, the better the rates will be that they offer you, meaning more money for you in the long-run.

If you anticipate needing that money in the near future, though, a short-term CD is probably a better option. The APR that banks offer likely won’t be as lucrative, but you’ll have access to your money sooner and won’t have to pay a fee for taking your deposit out before it matures.

What if I need to withdraw a CD before it matures?

Though the CD interest rates might be what initially catches your eye, there’s something else that you should consider before making a decision to invest in a CD: early withdrawal fees. Most financial institutions will charge you a fee if you withdraw your money before your CD matures.

It doesn’t have to be all bad though. If the interest that you collect outweighs the fee, you can still make a respectable profit from your CD.

The Bottom Line

In the end, there are a wide variety of great CD options. While it may be tempting to throw your money at a CD with the best rates, it’s important to remember that more goes into the decision than just a high APY. Do your homework and be mindful of what term would work best for your needs so you make a decision that you’re happy with.